Employee Benefits – P11D

As an employer, businesses are required to report to HMRC any benefits and expenses which you pay to employees.  The company will be required to pay Class 1A National Insurance on these benefits provided, and the individual will incur income tax on the benefits received, deducted via PAYE.

Taxable benefits are defined as expenses the business incurs but have a personal benefit for the employee, such as health insurance or company car for example.

These benefits are reported to HMRC by way of a P11D and P11D(b) form. These forms outline all benefits provided to employees. The P11D forms are required to be submitted to HMRC by 6 July following the end of the tax year, and any liability which arises from this submission has to be paid electronically by 22nd July.

The liability is calculated at 13.8% of the value of the benefit.

There are some expenses which you are exempt from reporting such as business travel, phone bills, business entertainment and uniforms, and this is advantageous for smaller businesses.

The most common taxable benefits include company cars, health insurance, fuel and gym memberships.

If you fail to declare any benefits/expenses to HMRC then you could be subject to fines and penalties.


Should you require assistance in preparing Forms P11D and P11D(b),  please contact any branch of Perrys and we will be happy to help.